FOREX-Dollar retreats from highs, Weber lifts euro

(Changes byline, updates prices, adds quotes and comment)

* Euro rebounds from 6-month low: last at $1.4750 <EUR=>

* ECB's Weber boosts euro with hawkish rhetoric

* Dollar off highs: dollar index trades at 76.87

* Oil price rebound, profit-taking also weighs on dollar

By Simon Falush

LONDON, Aug 27 (Reuters) - The dollar retreated on Wednesday as dealers cashed in on the currency's jump the previous session to 2008 highs against a basket of currencies while hawkish rhetoric from a European Central Bank policymaker lifted the euro.

The euro was already in recovery mode from Tuesday's six-month low set after a report showed the Ifo index of German business confidence slumping to a three-year low.

It got a further shot in the arm when European Central Bank Executive Board member Axel Weber said any talk about lower interest rates in the euro zone is premature. Click on [ID:nWEA7206] for more on this story.

A rebound in oil prices, as well as persistent concern about the U.S. economy and banking system, had earlier also helped dent sentiment on the dollar and trigger the bout of profit-taking.

"There's a suggestion that the dollar's recovery has come too far, too fast," said Chris Turner, head of FX strategy at ING.

"People are a bit in shock at the speed of the move in the dollar and short-term yield spreads don't justify the extent of the euro's fall."

At 1113 GMT the euro was up 0.7 percent on the day at $1.4750 <EUR=>, bouncing back from a six-month low of $1.4570 reached in the previous session on trading platform EBS.

The dollar index, a measure of the greenback's value against six major currencies, fell 0.7 percent on the day to 76.73 .DXY, having hit a 2008 high on Tuesday at 77.619.

Sterling rose 0.35 percent to $1.8463 <GBP=>, after slumping to a two-year trough of $1.8330 on Tuesday, though it fell to a 12-year low on a trade weighted basis <=GBP> after falling against the euro. The dollar fell 0.7 percent against the yen to 108.81 yen <JPY=>.